The latest Japanese Prime Minister - Shigeru Ishiba.

A man who can collapse the Nikkei as soon as he takes office, a rebel against Abenomics.

A strong advocate of Japan-US decoupling, is he a king or a destroyer?

He unexpectedly won the election and will take office in October 2024, replacing Fumio Kishida.

Ishiba's leadership symbolizes an important shift in Japan's political and economic policies. The decline in the Nikkei index as soon as the news of his election came out is also a clear indication that there may be changes in financial and economic policies.

In particular, he is seen as a separation from the policies of former Prime Minister Shinzo Abe.

Looking back at Abenomics, the core strategy is called the "three arrows", including monetary easing (QE), fiscal stimulus and structural reform. These three parts work together to promote economic growth and get rid of Japan's long-term deflation.

And Shigeru Ishiba's new economic policy criticized the Bank of Japan's aggressive monetary easing policy over the past decade, arguing that the long-term low interest rate policy may need to be reviewed. He proposed a possible monetary tightening policy, which means that Japan may enter a cycle of interest rate hikes.

He supports raising taxes, especially on corporate and investment income, to address the government's growing debt. This suggests that he favors fiscal responsibility, but this may face opposition from businesses and investors.

Economic Reform: Ishiba calls for reforms to Japan's economic structure to reduce its reliance on debt-driven growth. His strategy includes a reassessment of Japan's industrial policy, which may promote independent capacity building in certain areas.

He may promote investment in defense and technology, which is consistent with his security-oriented leadership background. In addition, the increase in the defense budget is expected to double by 2027.

The impact on the stock market is not optimistic at present. But we should continue to watch him in the next few months. The market has shown some volatility due to uncertainty about his policies, especially due to concerns about possible monetary tightening and rising corporate taxes.

Companies that benefit from the Bank of Japan's low interest rate policy, especially export-oriented and technology companies, may be affected.

However, industries that meet Ishiba's policy priorities, such as defense, infrastructure, and technology, may benefit and grow from the government's priority investments.